British businesses face ‘difficult year’


British businesses are facing a difficult year in 2008, according to the Confederation of British Industry (CBI).

The pro-business lobby group has warned that the short-term domestic slowdown and the longer-term impact of structural changes in the global economy will present significant challenges to British firms.

This could be bad news for commercial property agents, as it is likely to see businesses scaling back expansion plans and looking to cut overheads.

Despite the CBI’s concerns, director-general Richard Lambert said it was important to keep things in perspective, suggesting that the economy was in for a soft rather than a hard landing.

"If we allow ourselves to get carried away by today’s gloomy headlines, we could talk ourselves into something much worse," he warned.

With oil prices remaining high and credit harder to obtain after the recent liquidity squeeze, business leaders could be forgiven for entering the new year in a downbeat mood.

However, the CBI notes that with the Bank of England on top of inflation and Britain’s flexible labour market, the country is in good shape to cope with the slowdown in economic growth.